Single Touch Payroll, otherwise referred to as STP, was introduced on 1st July 2019 and is the way all Australian business owners report their PAYG and superannuation information to the Australian Tax Office (ATO).
Up until the introduction of STP, there were many differing ways a business owner would record their employees PAYG and super information and different timelines they would report this important information to the ATO. The introduction of STP saw this reporting process streamlined and automated for both business owners and the ATO.
The process is now being expanding with Single Touch Payroll (STP) Phase 2. The mandatory start date for STP Phase 2 reporting will be 1 January 2022.
Read below to learn more about Single Touch Payroll (STP) and Single Touch Payroll (STP) Phase 2 including:
- What Single Touch Payroll (STP) reporting exemptions have now ended?
- What is the purpose of Single Touch Payroll (STP) Phase 2?
- What are the main changes with Single Touch Payroll (STP) Phase 2?
What Single Touch Payroll (STP) reporting exemptions have now ended?
When STP was first introduced some exemptions to using this process were available for a period then reviewed on expiry of the exemption. As STP has been around now for over 2 years the time for some exemptions has ended.
Business with between one and four employees who were manually recording their payroll may have been eligible to still report quarterly to the ATO however this was only up until June 2021. They will now have to be using STP enabled software or reporting through a registered tax or BAS agent.
Employers with only closely held payees or non-business employers, such as carers holding a Withholding Payer Number (WPN) now need to report this as well.
Exemptions may have been or be available in special circumstances, on a case-by-case basis. For example, having no internet connection or having a business in administration. Check with your registered tax professional if you think you may qualify.
What is the purpose of Single Touch Payroll (STP) Phase 2?
STP phase 2 will streamline the STP process further by reducing the amount of reporting required by employers with employees who require their information to be reported to multiple government agencies. It also supports the administration of the social security system. The Australian Tax Office (ATO) is working closely with digital service providers who will update their STP-enabled software. As a business owner, what you need to do will be based on the product you use and how your payroll is managed.
What are the main changes with Single Touch Payroll (STP) Phase 2?
A factsheet is available from the ATO that covers the key changes. For a copy of the factsheet follow the link below.
Expanding Single Touch Payroll Phase 2
One of the key changes will be the added information included in your STP report will result in Tax File Number (TFN) Declarations no longer needing to be sent to the ATO – you will only need to keep them with your employee records. More detailed information about the coming changes will be available from the ATO in the coming months.
FREED UP Accounting & Bookkeeping Solutions main principal is a registered BAS agent and available to help with the STP recording and reporting for your business.
At FREED UP Accounting & Bookkeeping Solutions, our main principal, Naomi is a registered BAS Agent (#25959844) with the ATO. She is also a qualified Accountant with a Bachelor of Financial Admin (Accounting) and a member of the Institute of Certified Bookkeepers and the Australian Bookkeepers Network.
Proudly servicing Perth and regional areas of Western Australia, our team at FREED UP Accounting & Bookkeeping Solutions are experts in providing cutting edge advice for small businesses. Call our team today on 0438 977 767.
Sources:
https://www.ato.gov.au/Business/Single-Touch-Payroll/Expanding-Single-Touch-Payroll-(Phase-2)/
Disclaimer: The information in this article is general information only